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Would you punch Johnny Depp in the face for $100,000?  “City of Lies” location manager Gregg “Rocky” Brooks had the chance after Depp allegedly punched Brooks in the ribs twice and demanded he punch Depp back in the face for $100,000.  Brooks declined the offer only to later deliver what could be a much more painful blow – a ten-count lawsuit leveled at Depp and the filmmakers for intentional torts and negligence.

The lawsuit filed last week alleges Brooks, as location manager, was in charge of ensuring the film’s production team was complying with its city permit which allowed filming outside the downtown Barclay Hotel from 7:00 a.m. to 7:00 p.m.  Toward the end of the day on April 13, 2017, the complaint alleges Depp required additional time to complete a scene and Brooks was able to obtain a new filming permit extending the time to 11:00 p.m.  But once it appeared that the additional four hours would not be enough, Brooks claims the film’s director Brad Furman (also a defendant in the suit) instructed Brooks to tell Depp to wrap up.

On his way over to Depp, Brooks contends Depp attacked him and launched into an expletive-laced tirade.  As Brooks tried to explain he had to ensure everyone complied with the city permit, Depp reportedly punched Brooks in the ribs twice and then exclaimed, “I will give you one hundred thousand dollars to punch me in the face right now!”  Brooks declined and says Depp continued to scream until Depp’s bodyguards arrived to restrain him.  Brooks also claims Depp’s breath reeked with alcohol and believes he was drinking and consuming drugs throughout the day on set.

Brooks’ action advances claims against Depp for assault and battery, intentional infliction of emotional distress and negligence.  He also seeks recovery against Furman, the film’s producer Miriam Segal, and the film’s production companies Good Film Productions and Infinitum Nihil for negligent supervision, negligent hiring, hostile work environment, negligent infliction of emotional distress, wrongful termination and retaliation.  Brooks blames Furman for negligently delegating his duty to direct Depp to cease work, placing Brooks in the unenviable role of a messenger with bad news.  Brooks also contends the filmmakers were on notice of Depp’s alleged volatile temper and habitual substance abuse yet retained him in conscious disregard for the safety of other employees.  Brooks finally claims wrongful termination and retaliation based on the allegation that he was terminated the Monday following the alleged altercation after refusing to sign a waiver at Segal’s request releasing the production of all claims Brooks may have against it arising from the incident.

Depp has yet to issue a statement in response to the suit, but Furman has come to his defense telling CBS News “Johnny Depp is a consummate professional” and “always treats the crew and people around him with the utmost respect.”  He added, “movies can be stressful, and non-events often become exaggerated.”

How “exaggerated” this incident was remains to be seen.

California’s Actor-Age Censorship Law (AB 1687), which would have required IMDb.com to remove age-related information from its web pages, was declared unconstitutional by a district court last month on free speech grounds.

75365726 – IMDb biography profile of actress Meryl Streep.

SAG-AFTRA vigorously campaigned for the law, which it claimed would mitigate age discrimination in Hollywood.  Within two months of the law taking effect in 2017, IMDb obtained a preliminary injunction and later filed for summary judgment claiming the legislation impermissibly restricted its First Amendment rights.  Judge Vince Chhabria of the Northern District of California agreed.

Although Chhabria acknowledged the law may be well-intentioned, he applied strict scrutiny and found the law is not narrowly tailored to eliminate age discrimination in the industry.

The law is under-inclusive, Chhabria determined, because it targets solely IMDb rather than other online sources which would remain free to broadcast an actor’s age.  The law also required IMDb to remove age-related information of an actor only if he or she requests the information be removed, yet the site would remain free to publish the birthdates of non-subscribers and, in theory, leave those individuals vulnerable to potential discrimination.

Chhabria found the law to be over-inclusive because it requires IMDb to remove ages of all requesting subscribers, including those under 40 who are not protected by the state’s anti-discrimination laws.

Further, Chhabria viewed the law as a direct restriction on speech prohibiting IMDb from publishing truthful information that is often supplied by the public because of speculation that a third party might use the information for unlawful purposes.  “There is no support in controlling case law for the proposition that a state may ban publication of facts to impede a third party’s possible reliance on those facts to engage in discrimination,” Chhabria found.

Supporters of the law argued it regulates commercial speech and honors the contract between subscribers and IMDb who, by subscribing to the database, can select what information about them is displayed to the public.  Chhabria was not persuaded.  “The speech at issue is factual information about entertainment professionals, conveyed… in a manner unconnected to any commercial transaction,” he wrote.  Further, the law requires IMDb to remove age-related information from its website regardless of the source of the information and, accordingly, “expressly contemplates that it will impact not just information obtained pursuant to a contractual relationship, but also information provided by members of the public,” Chhabria wrote.

In dicta, Chhabria observed the law’s legislative materials repeatedly cite an article discussing sex discrimination in the entertainment industry and opined that, although the law facially targets age discrimination in Hollywood, the actual purpose of the law is to combat sexism.  “The defendants barely acknowledge this,” Chhabria noted, “much less explain how a law preventing one company from posting age-related information on one website could discourage the entertainment industry from continuing to objectify and devalue women.”

SAG-AFTRA’s general counsel Duncan Crabtree-Ireland stated the union is “extremely disappointed with [the] ruling.”  He added, “the Court unfortunately fails to understand or recognize the massive impact gender and age discrimination has on all working performers.  That discrimination is facilitated by IMDb’s insistence on publishing performers’ age information without their consent…”.

SAG-AFTRA and the State of California are expected to appeal this decision to the Ninth Circuit.

In response to the numerous allegations of pervasive sexual harassment in the entertainment industry, SAG-AFTRA, the union representing performers, recently adopted a “Code of Conduct” for handling sexual harassment claims against producers.  As the representative of performers across the country, it is only natural that SAG-AFTRA would seek to address the sexual harassment scandal that has pervaded the industry. The opening of this new front against sexual harassment may provide support for more performers to come forward and bring claims against producers.

Casting call - actors waiting at a casting sessionThe Code of Conduct provides a resource for performers to assist them in filing civil and criminal complaints against their employers, as well as processing claims under the collective bargaining agreements (CBA) between SAG-AFTRA and the Producer’s Alliance.  It also ominously claims that the union is “willing to use the union’s enforcement powers to protect our members, including directing them not to work for employers who will not keep them safe.”

SAG-AFTRA, as a labor union, has certain powers and limitations in advancing the interests of its members.  In terms of legal claims, the union can point performers in the right direction, or possibly pay for legal counsel (which is not mentioned in the Code), but it is unlikely that it could directly bring sexual harassment claims in court on behalf of members. Unions are typically bound by the grievance and arbitration procedures contained in their CBAs. In addition, the union is also subject to conflicts in terms of member-on-member sexual harassment, which could lead to inaction or delays on behalf of the accuser. Finally, like most unions, SAG-AFTRA is bound by a no-strike clause in its CBAs, which would likely limit its ability to carry through on its threat to direct members not to work for certain employers.

Law concept: circuit board with copyright icon, 3d renderRedbox scored a win in its copyright dispute with Disney as a federal district court judge refused to award the studio a preliminary injunction against Redbox’s sale of digital download codes.

Disney’s complaint was that Redbox was purchasing “Combo Packs” of Disney movies, which include a DVD, Blu-Ray disc and digital download code, opening the packages and selling its components separately. This, Disney claimed, encouraged consumers to violate the terms of copyright licenses set forth on printed inserts in the Combo Packs and warnings on the download websites Disney Movies Anywhere and RedeemDigitalMovies, which purport to restrict use of the codes to owners of the physical discs.

Redbox had thrown up two defenses to Disney’s copyright claim. First, that the download codes are equivalent to the physical discs under the first sale doctrine. Second, that Disney was guilty of “copyright misuse.”

The parties’ briefing focused primarily on the applicability of the first sale doctrine. This provides that once a copyright owner sells a particular copy of a work, such as a book, it cannot prohibit the buyer from subsequent sales or transfers of that copy. Redbox contended that the paper slip bearing the download code constituted a particular copy of the movie no less than the DVD and Blu-Ray discs in the Combo Packs. Disney conceded that the first sale doctrine applied to the DVD and Blu-Ray discs in the Combo Packs, but maintained that the download codes were not copies of the movies at all, but only keys by which consumers could then create copies of the work on their own computers. The court sided with Disney on this issue, holding that no “copy” existed at all until the consumer activated the code and downloaded the movie.

Somewhat surprisingly, despite the attention paid by the parties to the issue, the court held that the first sale doctrine was not applicable to the case because Disney’s misuse of copyright was sufficient to tip the scales in Redbox’s favor. The copyright misuse doctrine furnishes a defense to an infringement claim when a copyright owner is found to be leveraging its limited monopoly under copyright to obtain benefits outside the scope of the copyright monopoly. In one leading case, for example, the owner of a copyrighted medical coding system attempted obtain an unfair advantage over competitors by conditioning licenses of its system on a promise that the licensees would not use competing systems.

In Disney’s case, the court held that it was a misuse of copyright for it to try to link its legitimate right to restrict transfers of the download codes to a waiver of consumers’ conceded right to transfer the physical discs. The license agreements for digital downloads of the Disney movies on the RedeemDigitalMovies requires redeemers to represent that the are currently “the owner of the physical product that accompanied the digital code at the time of purchase.” Similarly, the terms of use on the Movies Anywhere website only allow registered members to “enter authorized . . . Digital Copy codes from a Digital Copy enabled . . . physical product that is owned by [that member].” The court viewed these conditions as overreaching, stating, “Thus, Combo Pack purchasers cannot access digital movie content, for which they have already paid, . . . unless they forego their statutorily-guaranteed to distribute their physical copies of that same movie as they see fit.”

The court also rejected Disney’s breach of contract claim against Redbox. The outside of the Combo Pack box contained the notice “Codes are not for sale or transfer.” This, Disney claimed, established a binding contractual obligation on Redbox not to resell the download codes. Although the court acknowledged that notices printed on packaging can create enforceable obligations, it held that the notice on the Combo Packs was insufficient to do so.

This case presents an interesting takeaway. Although Disney prevailed on the first sale issue, which both parties apparently believed would be determinative, it lost on more mundane issues going to the wording of its license terms. It’s possible that with clearer and narrower drafting Disney will be able to accomplish its goal of preventing resale of download codes. In the meantime, even without a preliminary injunction in place, Disney could continue to pursue this case to trial.

Redbox and Disney have filed their briefs in preparation for argument, scheduled for February 5, on Disney’s motion for a preliminary injunction against Redbox’s alleged copyright infringement. The judge’s ruling could make new law on the meaning of a “copy” in the digital age.

The underlying facts are these: Redbox legally purchased “Combo Packs” of Disney movies. These included DVD and Blu-Ray discs as well as a code by which the purchaser could download a copy of the movie. Redbox unbundled the packs and sold the download codes to consumers.

As Disney anticipated in its original motion, Redbox’s principal defense relies on the first sale doctrine under copyright law, which allows someone who lawfully acquires a “copy” of a copyrighted work to sell or dispose of that copy. Redbox claims that a download code is legally indistinguishable from a physical copy such as a DVD. Just as the first sale doctrine permits it to rent DVDs through its ubiquitous red kiosks, it can resell the download codes on its website.

Disney asserts that the codes are not themselves copies of the films but rather keys to open up a copy. Therefore Redbox’s activities do not implicate the distribution right in the movies (which would be permitted under the first sale doctrine), but the reproduction right, which is infringed when Redbox’s customers make unauthorized copies by using the code.

One interesting consequence of Disney’s position is that its claims against Redbox can only be based on contributory rather than direct infringement of Disney’s copyrights. Since Disney’s position is that the codes are not “copies” of the movies (and thus outside the first sale doctrine), it cannot assert that Redbox is distributing or reproducing its copyrighted works. The direct infringers are the Redbox customers who use the codes. Redbox contributes to the infringement by selling the codes. This argument raises the further question whether consumers are, in fact engaged in infringing activity.

In order to establish this, Disney relies on the “shrink wrap license” that governs its sale of the codes. The Combo Packs are packaged and priced to be sold as a unit. The outside packaging of the Combo Packs states that “codes are not for sale or transfer”; similar language appears on the package insert containing the code. A consumer redeeming the codes on the Disney portal is likewise required to represent that he or she is “the owner of the physical product that accompanied the digital code at the time of purchase.” A customer buying a code would not see the first two of these warnings. Redbox used this fact to argue that Disney was trying to impose the terms of a license between Disney and Redbox on to its customers. Disney’s response is that the license terms to which customers agree before downloading a movie from the Disney portal are sufficient to create the underlying infringement on which Redbox’s contributory liability rests.

This lawsuit is one of a number of recent cases testing the status of links and download codes under copyright law. Playboy Entertainment Group has commenced litigation against a website that posted links to a third party site displaying every Playmate photo ever published. Although the content of the copyrights at issue in that case could not be more different from the family-friendly content of the movies at issue in the Disney-Redbox litigation, they both address the problem of defining what constitutes digital copying and distribution of copyrighted works.

The jury has spoken. After a saga worth of Homer, Comic-Con is a valid trademark.

The battle began when, the organizers of San Diego Comic-Con (SDCC), the 50-year old grandaddy of fan conventions, sued the producers of Salt Lake Comic Con for infringement. As we previously reported, the defendants struck back by asserting that comic con (no hyphen) had become a generic descriptor for comic book conventions, citing the scores of events around the country that describe themselves the same way.

The case took a curious turn when the trial judge issued a gag order against the defendants prohibiting them from taking their case to social media, bringing First Amendment issues into what was otherwise a straightforward trademark case. The Salt Lake crew challenged this order by seeking a writ of mandamus from the Circuit Court, which agreed with them and vacated the order.

The case went to trial in early December, with a verdict in favor of the San Diego Comic-Con. The jury found both that the plaintiff’s mark is valid and also that it was infringed. It determined, however, that the infringement was not willful, and awarded only $20,000 in damages rather than the $12 million demanded by the plaintiffs. Nevertheless, armed with a finding of validity, SDCC could be emboldened to take action against other comic book conventions.

The defendants, meanwhile, have not laid down their weapons. They’ve announced an intention to appeal the verdict and are also pursuing an petition before the US Patent and Trademark Office to cancel the rival mark.

 

Bryan Golerkansky and Ryan Dunner, supervising senior associates at Green Hasson Janks, write:

With the new age of digital streaming and an abundant amount of on-demand content available for  24/7 consumption, many consumers have opted to stay at home on a Friday night binging on television series and movies as opposed to the traditional theater viewing experience.  One attempt to draw moviegoers back into theater seats is the creation of MoviePass, a low-fee subscription-based movie service which allows subscribers to use a mobile application and prepaid card to view one movie per day at participating locations.

Movie theater
Copyright: fergregory / 123RF Stock Photo

MoviePass, founded in 2011, was originally backed by investors such as True Ventures, AOL Ventures and Chris Kelly (former Chief Privacy Officer of Facebook). With an original price hovering around $50 per month, MoviePass initially had difficulties growing their subscriber base. In 2016, MoviePass hired Mitch Lowe as CEO, a previous executive at both Netflix and Redbox. Lowe identified the significant issues and began focusing on the pricing structure of the service. In July of 2016, MoviePass announced alternative subscription plans allowing subscribers to view two, three or unlimited movies per month with the lowest tier starting at $15 per month. Even with the new pricing model, the subscriber base had only reached 20,000 and MoviePass was still searching for a way to appeal to the masses.

In August 2017, analytics firm Helios and Matheson obtained a majority stake in MoviePass and brought a fresh business model to the company. Through their analytics background, they saw the true potential of using MoviePass to follow a platform, similar to Facebook, where the emphasis was on data collection and targeted advertising as opposed to high subscription fees. In the same year, monthly subscription fees for unlimited films were dropped to $9.95 as their priority was to increase the subscriber base. While this new price point has created a surge in new subscribers, it may also cause MoviePass to operate at a loss due to the fact that MoviePass must subsidize the difference between the full ticket price and the amount collected in monthly subscription fees. MoviePass has already anticipated such losses and is focusing on selling its users’ data to create additional revenue streams to offset potential losses. By accessing its users’ mobile files, pictures and offering users the ability to sync with their Facebook profiles, MoviePass will be able to offer major film studios the opportunity to measure the effectiveness of their movie marketing campaigns. To date, movie studios have the ability to promote their films through social media platforms, strategically targeting specific demographics, but do not have the ability to track who, within the targeted demographic, actually viewed the film. Another alternative plan to boost revenue is a potential launch of an online streaming service which was suggested by Lowe in a recent interview with CNBC. Currently the subscriber base is up to 600,000 and growing.

While the amount of subscribers has exponentially grown in 2017, MoviePass still has to overcome multiple challenges to ensure its success for the future. With approximately 90% of U.S. theaters participating in the subscription program, MoviePass is pressured to continue this rapid growth in order to keep exhibitors enticed and increase the overall sales of concessions, the main source of profit for exhibitors. Another reason MoviePass must increase its subscriber base is to obtain valuable user data that can be sold to movie studios in an effort to provide them with the tools to create more effective marketing campaigns at lower costs.

Assuming MoviePass changes the theater-going experience like Netflix transformed the way we consume content, the end result could be a real game changer. The exhibitors would see a spike in both ticket and concession sales, movie studios will receive additional theatrical revenue and actionable data to lower their marketing campaign costs, and ultimately profit participants should expect to share in higher theatrical revenue and lower overall marketing costs.

Will MoviePass be successful in revitalizing the traditional theater viewing experience or will the current shift to anywhere, anytime viewing continue? Only time will tell.


This post was originally published on the Green Hasson Janks Media Clips blog.

A federal court on Monday held California’s State Insurance Compensation Fund has no obligation to cover a series of claims from three porn actors against Cybernet for allegedly causing them to contract human immunodeficiency virus (HIV) during film shoots in 2013.

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Cybernet, a San Francisco-based porn studio, was founded in 1998 and currently operates a series of adult-websites including Kink.com which primarily features content involving bondage, domination, sadism, and masochism (BDSM).  Actors John Doe, Cameron Adams and Joshua Rogers sued the company in 2015 for creating a dangerous and unsanitary work environment by failing to test performers for sexually transmitted diseases before each shoot, discouraging the use of condoms, and inviting random members of the public to participate in intimate group activities.  The actors further allege Cybernet intentionally misrepresented the shoots were safe by “requiring” the use of protection, subjected actors to physical assault without consent, and intentionally inflicted emotional distress by creating a situation where the spread of sexually transmitted diseases was virtually certain to occur.

After Cybernet demanded that its insurer, the State Fund, cover the actors’ tort claims, the State Fund fired back, arguing it already paid the actors medical expenses under California’s workers’ compensation system and owed no further duty.  U.S. District Court Judge for the Northern District of California Yvonne Gonzalez Rogers agreed and found the actors’ exclusive remedy for their negligence-based causes of action came within the workers’ compensation system.

Further, while the actors’ allegations of intentional misconduct were not necessarily relegated to workers’ compensation, Rogers found the insurance policy’s exclusion for “damages or bodily injury intentionally caused or aggravated by [Cybernet]” exempted claims of intentional torts.  Cybernet argued case law requires insurers to provide conclusive evidence demonstrating an exclusion of coverage applies and such evidence did not exist for a myriad of reasons, including the language of the policy itself which expressly covered “bodily injury by disease of an employee.”  Rogers was not convinced and cited precedent which indicated that even though an insurance policy can expressly cover a disease contracted on the job, claims that the employer intentionally caused or aggravated the disease are a different story.           

Cybernet has requested leave to file a motion for reconsideration.

Music festival and audienceFox associates Megan Center and Elizabeth Patton wrote a duo of posts for Fox’s advertising law blog Above the Fold examining a trademark dispute surrounding the term “Coachella.” The case relates to entertainment festivals not associated with the organizers of the well-known annual event in Indio, California. As Megan lays out in her post:

“Robert Trevor Simms (Simms) purported to create a film festival known as FILMCHELLA. Prior to filing for the injunction, Coachella Music Festival, LLC and Goldenvoice, LLC (collectively, Coachella) sent numerous cease and desist letters to Simms demanding that Simms change its name with no success. As such, Coachella was forced to file for a preliminary injunction to prevent Simms from using the terms, “Filmchella”, “Coachella for Movies” and “Coachella Film Festival” due to alleged trademark infringement. Coachella argued that Simms’ use of these terms will cause consumer confusion, dilution of its marks and other irreparable harm.”

The U.S. District Court for the Central District of California recently granted a preliminary injunction in the case to Coachella’s organizers. Elizabeth also provided an update yesterday on a flurry of motions filed by the parties in the case.

My partner Nancy Yaffe has just posted a blog with disturbing implications for California entertainment lawyers. As young practitioners we  all were taught that every agreement with a person providing services on a film or TV show must include a provision that the results and proceeds of the person’s services are a “work made for hire” under copyright law.  This language is as important for entertainment lawyers as the Prime Directive is for Capt. Kirk on Star Trek. It now appears that the California EDD takes the position that the presence of those four words in a contract creates a presumption that the service provider is an employee, not a contractor. The Department will take this position even if none of the other indicia of employment are present, and regardless of the plain intent and structure of the Copyright Act.

Law concept: circuit board with  copyright icon, 3d render

Producers can still obtain copyright ownership using assignment language, but this has drawbacks, including that the assignor can terminate the assignment after 35 years. This presents producers with a difficult choice. Proceed as usual and run the risk of being assessed for back taxes and penalties, or engage all cast and crew as employees, with the inconvenience and cost that can entail.

Read Nancy’s enlightening blog here.